Bored Ape suffers from losses and is forced to sell, aristocratic holders become big losers

Bored Ape faces losses and must sell, causing aristocratic holders to also suffer significant losses.

The Bored Ape Yacht Club (BAYC), also known as the NFT aristocracy, is undergoing a tearful sell-off. Holders such as singer Huang Li Cheng have recently been selling BAYC NFTs, causing the floor price of the series to drop to below 30 ETH (about $57,000).

More than a year ago, BAYC was still a darling of the fashion world, with stars like Steph Curry and Justin Bieber buying. Today, the floor price of the series has dropped by more than 85% from its high point, and celebrities and big players have been cut into “big wronged seeds.”

Despite YugaLabs, the brand behind the Bored Ape, claiming to be the most knowledgeable NFT issuer, neither gaming nor creating a metaverse can change the downward trend.

The overall NFT market is also in a slump, with a total market value of $6.05 billion, down 79.35% from its peak of $29.3 billion.

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Mao Shihang (Shen Yu), co-founder of Cobo Wallet, believes that the narrative logic of NFTs needs to be reorganized and that NFTs can bring in a large number of new users by combining offline fan economics and membership benefits beyond the PFP (personal avatar class) concept.

In other words, NFTs need to become more “useful.”

The Bored Ape went from a luxury home to a car crash.

On July 7, a brief NFT transaction caught the attention of the crypto world. Despite selling for a high price of 200 ETH (about $372,000), only sighs were left for the crypto community.

The protagonist of this transaction comes from the most prestigious Bored Ape series in the NFT field. The “monkey” with the number BAYC #3953 has cream-colored fur, protruding eyes, and a small piece of pizza in its mouth. Among the total of 10,000 Bored Ape NFTs, this “monkey” has a very high recognition rate and is ranked second in rarity on the NFT rarity ranking website Rarity Sniper.

This top-notch bored ape was traded during the lowest period of the NFT market, so many NFT old-timers added the prefix “for sale only” before the price of 200 ETH, which was clearly a discount promotion. Compared to the peak price of the bored ape, the selling price was indeed only a fraction. In an auction at Sotheby’s in 2021, BAYC #8817, which ranked 16th in rarity, was once sold for a sky-high price of $3.4 million.

Bored Ape Yacht Club (BAYC) is currently experiencing the largest sell-off in its history. In the month of June alone, singer Huang Li sold at least 74 BAYC NFTs. According to Nansen, a blockchain tracking tool, many long-term holders of BAYC have also sold their NFTs. Of the 39 addresses that have held BAYC for over a year, this indicates that loyal BAYC fans are gradually leaving the game.

The overall floor price of the Bored Ape Yacht Club NFT series has also fallen sharply. Last week, the floor price of BAYC fell below 30 ETH. On July 11th, the floor price of the NFT rose to 33 ETH, or about $62,000. Although this price is still expensive for ordinary people, on April 30th, 2022, the floor price of BAYC once reached a peak of 153.7 ETH. At that time, the cheapest Bored Ape was worth $430,000, or about RMB 3 million.

With the bursting of the NFT market bubble, Bored Apes have come down from the altar of nobility, and their market value has fallen from a luxury mansion to a low-end BMW 5 Series, with a price drop of more than 85%.

The huge decline has caused major losses for the big buyers who once bought Bored Apes at high prices. An NFT collector posted on WeChat, calling himself a “big loser” and jokingly said, “I bought it for 118 ETH, let’s see when it drops to 18 ETH.”

More striking are the losses suffered by celebrities and commercial brands. During the heyday of Bored Apes, it was sought after by many domestic and foreign celebrities, including basketball stars Curry and O’Neal, famous singers Justin Bieber, Jay Chou, and JJ Lin, who have all posted pictures of their Bored Ape NFTs online.

In January 2022, Justin Bieber spent about $1.29 million to buy BAYC #3001. Today, the highest bid for that NFT on OpenSea is only $61,000, meaning he has a floating loss of more than $1.2 million. In May 2022, Li Ning, the chairman of Meitu Group, announced that he had bought BAYC #8848 for about $560,000. The highest bid for this NFT is also only $61,000 today. In addition, Li Ning China bought BAYC #4102 for 120 ETH (about $356,000), and Greenland Group bought BAYC #8302 for 140 ETH, both of which have shrunk by more than 80% in value.

Justin Bieber buys Bored Ape with a loss of over $1.2 million.As the leader of NFTs, the falling price of Bored Ape is a reflection of the NFT market’s darkest moment. According to NFTGO’s data, the total market value of the NFT market has dropped from a peak of $29.3 billion to today’s $6.05 billion, a decrease of 79.35%. In the past month, 44.5 people in the NFT trading users have lost money, and only 46,000 have made money.Where will the NFT market break the ice?Whales lose big money, and small shrimps lose small money. The NFT market, which has had a huge wealth effect, has become a battlefield, and the difficulty of making money by investing in NFTs has soared.On social media, with the plummeting prices of NFTs such as Bored Ape, there are all kinds of ridicule. Some people call it a “picture hype scam,” and some compare it to the bursting of the tulip bubble. In the Web3 field, the subject matter about NFTs is no longer sexy, and few people discuss NFTs in various Web3 communities. “I still cannot understand the value of these pictures,” said a cryptocurrency user who entered the industry in 2018.Seeing tall buildings towering and high market values, the building collapsed in an instant, and the NFT entered an ice age. In fact, NFT projects represented by Bored Ape have also made efforts. The issuers of NFTs have tried a lot to make the value of NFTs more than just a picture, but everything is not very effective during the bear market.Yuga Labs, the “manufacturer” of Bored Ape, has always been regarded as the most marketing-savvy brand in the industry. Bored Ape’s initial success was also due to its creation of the concept of a “club,” which made Bored Ape NFT a ticket to the “rich club.””Club members” not only have full ownership of Bored Ape NFT, but can also use it for commercialization. For example, when Li Ning of China bought Bored Ape NFT, he imprinted its image on clothing for sale. The Web3 label under Universal Music Group even used Bored Ape to create a virtual band.

In addition, Bored Ape NFT holders have various airdrop benefits, such as when Yuga Labs issued the Bored Ape Mutant series NFT, NFT was airdropped to Bored Ape users, and both NFT holders received airdrops of Bored Ape token APE in the future. For many Bored Ape holders, holding this NFT is also a form of identity, representing the upper class and trendsetters in the Web3 world.

In the subsequent operation process, Yuga Labs also created the OtherSide Metaverse as another empowerment for BAYC holders, providing virtual land to holders; in February of this year, Yuga Labs designed a game similar to “Temple Escape” called Dookey Dash, which required a passport NFT to participate, and the initial passport was only available to users who held Yuga series NFT such as BAYC for free.

It can be said that YugaLabs has tried various means to add additional value to BAYC, but it still cannot stop the price decline of Bored Ape NFT.

A senior NFT player believes that all Bored Ape’s attempts still cannot escape the old narrative of PFP (personal avatar), that is, in all scenarios, the core meaning of BAYC lies in its identity, but lacks practical scene application value. Although Bored Ape has created games, Metaverse and other scenes on its own, they all have a considerable threshold for capital participation, forming an invisible wall with the outside world, making it difficult to increase ecological vitality.

Mao Shixing (Shen Yu), co-founder of Cobo Wallet, also recently stated that NFT is currently in a state of bubble bursting and narrative logic reconstruction. The next step for NFT is to find new narrative logic and landing scenarios other than the concept of PFP, perhaps combining NFT with offline scenarios, such as something that combines with fan economy and membership rights, which “should bring a large number of new users”.

From Shen Yu’s perspective, making NFT “useful”, rather than just an artwork or identity, is one direction to solve the current dilemma.

Previously, Starbucks explored the “practical” route of combining NFT with membership rights. Users can directly subscribe to NFT with credit cards in the Starbucks NFT market. NFT holders can participate in online coffee making tutorials, subscribe to joint artist merchandise, and be invited to participate in exclusive activities such as Starbucks Reserve Roasteries. Currently, Starbucks has attracted more than one million members and partners to join.

In addition, there are also fans hoping that NFTs can become equity tokens for celebrity fans in the future, such as holding Jay Chou’s fan NFTs. Fans with such tokens can enjoy benefits such as priority to purchase concert tickets and close interaction with celebrities. “When NFTs have real-world applications, people will have the motivation to buy and hold them.”

In the view of LD Capital, a crypto investment research institution, RWA equity-type NFTs may also become the breakthrough point for NFTs. RWA stands for the tokenization of real-world assets, which means mapping real-world assets such as real estate, cars, and jewelry to the blockchain to generate corresponding digital assets, thus having better liquidity and financial attributes.

Recently, a crypto industry KOL revealed that a borrower mortgaged a Patek Philippe watch to a third-party custodian, who then issued an NFT representing ownership of the physical watch. The borrower used the NFT to borrow digital assets on the chain, thus realizing the scenario of using real-world assets to borrow digital assets.

At a time when the NFT market is stagnant, the Web3 industry seems to need a new narrative to break the ice for NFTs.

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